Just In Time In Operation Management - Research Paper Example

?Just In Time (JIT) In Operation Management Just in time (JIT) management philosophy originated in Japan in the 1970s. The development of JIT is credited to Taiichi Ohno; he perfected the management philosophy for the Toyota manufacturing plants in Japan. The main purpose of JIT is to eradicate waste, that is, anything that is of no value based on the consumer perspectives. The activities that do not value are described as waste in JIT. They include waiting time (customer waiting and work-in-process), processing yield (start-up costs, yield rates), unnecessary activities and motion (waste in work methods), unnecessary transportation (customer travel through the facility, material handling), inventory storage waste (obsolescence, deterioration, space), waste from service and product defects (warranty, scrap, rework), and overproduction beyond what is required to suit the immediate demand. Fullerton and McWatters (82) define JIT as a manufacturing system used for the achievement of excellence through elimination of waste and constant improvements in productivity. It is also defined as a production system control that seeks to reduce WIP and raw materials inventories, eliminate defects, constantly simplify the production, stabilize production, and create a multi-skilled and flexible workforce. The following three components make significant contributing to effective practice of JIT and they include Total Quality Management (TQM), employee empowerment, and JIT manufacturing principles (Burnett and Pesch 1). Each of the elements will be discussed in detail. JIT Manufacturing Principles Within the manufacturing setting, the goals of JIT are pursued in six major ways. These ways include the utilization of a demand-pull production system, uniform plant loading, cellular flow layouts, inventory decrease to expose waste, rapid steps to decrease lot sizes, and flexible resources (Burnett and Pesch 1). Utilization of A Demand-Pull Production System The conventional approach to manufacturing management relies heavily on labor and machine utilization. The approach was based on the notion that the factory can only be efficient and productive if the managers make sure that the machines and the workers are busy. The approach is referred to as the push system. The system is not efficient and thus, JIT proposed the use of the demand-pull system. The demand-pull system is based on the notion that work should flow “to a work center only if that work center needs more work. If a work center is already occupied with work activity, the upstream work center should stop production until the downstream work center communicates a need for more material” (Burnett and Pesch 2). Within the JIT environment, emphasis on maintaining high usage is eliminated. The JIT environment focus is on dealing with the challenges that face the overall success of the factory; these challenges include quality improvement, waste elimination, and setup time reduction (Burnett and Pesch 2). Uniform Plant Loading The effective practice of JIT indicates possessing the correct quantities of the right products at the right time and the right place. Reducing the setup times permits the company to manufacture product mix and quantities demanded at the current time (Burnett and Pesch 2). Cellular Flow Layouts Repetitive process layouts are important in eliminating activities that add no value and thus, switching to a JIT environment. Intermittent layouts are not effective since they are filled with low visibility, uncertainty, and complexity. On the other hand, cell layouts enhance JIT goals through featuring high visibility, fast throughout times, and unidirectional product flows. Multifunctional workers are assigned individual cells and the responsibility and organization of the product produced. Workers in the cell environment tend to possess a huge sense of pride and ownership in the work environment. The thorough understanding of the production process enhances the chances for the workers to give ideas on improving the production process (Burnett and Pesch 3). Inventory Decrease to Expose Waste Inventory entails numerous waste practices such as long setup times, weak vendors, bad quality, and poor equipment. By steadily reducing the inventory, the production system weaknesses are revealed and solved one by one. The machines can be better maintained or replaced, delivery and vendor quality can be enhanced, quality practices can be adopted, equipment and labor can be laid out in an efficient manner, and the machine set up methods can be streamlined. The improvements permit the company to operate with less costs, quicker response times in order to meet consumer needs, and less inventory (Burnett and Pesch 2). Rapid Steps to Decrease Lot Sizes Traditional production management thinking enhanced the notion that units costs were driven down by the large similar production runs. The trouble was that huge production runs developed huge quantities of finished goods inventory and WIP that further exceeded the demand. Thus, the items would lead to long lead times, low flexibility in reacting to the consumer needs, high potential rework, and high levels of inventory costs. Within the JIT environment, the main aim is to drive down the setup times and setup costs in order to improve the factory competitiveness. For instance, during the 1980s, a company by the name 3M converted a factory that manufactured several adhesive products in long assembly runs into a company that manufactured over 500 adhesive products in small assembly runs (Burnett and Pesch 2). In order to control the unit production costs, 3M had to study the setups in its coating machines. Since the price of chemical waste clearance was a key “part of the cost of changing over a coating machines to make another product, 3m shortened the length of hoses that needed purging and redesigned the shape of the adhesive solution holding pan on the coating machine to be shallower” (Burnett and Pesch 2). 3M also utilized disposable filters, work teams, and quick-connect devices to speed up the setups. The outcome was that 3M could sustain low unit costs on the coating machines and at the same time producing small lots of numerous products to fulfill the market demand quickly (Burnett and Pesch 2). Flexible Resources Uncertainty is detrimental to JIT. The JIT environment flourishes on predictability in production processes, workers, suppliers, and customer demand. It is important to note that uncertainty can be eliminated in most company environments. Uncertainty is solved by implementing flexible resources that can adjust easily to the changing situations. Moveable equipment that is general purpose can meet various production needs and this is one way that flexibility can be improved. For instance, Toyota uses paint canisters attached to the paint sprayers; thus, a car can be painted with any color without the need to purge hoses when switching from one color to another (Burnett and Pesch 3). Flexibility in the work environment can also be enhanced by having multifunctional workers. For instance, at Honeywell’s cooling and heating controls plant, the employees are trained to operate all the machines present on their work line. The multifunctional workers provide flexibility in the work environment because they change the method of how work is done. Thus, the employee is not confined to working on one machine and at the end of the day; the employee is conversant of all the aspect of the line. The employees are also capable of working together to meet schedule and quality regardless of the situations (Burnett and Pesch 3). Total Quality Management Total Quality Management (TQM) is linked with the JIT philosophy because of the fact that quality is the main source of non-value-added activities and uncertainty in a company having poor quality practices. TQM enhances constant improvement, designing quality into processes and products, and doing the production for the first time (Burnett and Pesch 3). Employee Empowerment Front-line employees play a major role in effective JIT practice. These employees work in collaboration with the management and one another in the constant pursue for excellence. There are several means through which the front-line employees contribute to the success of JIT. Firstly, the employees improve the work processes through working together in problem solving teams in which they collect data and build consensus. Secondly, employees have the mandate of understanding work quality measure and the things they require to meet the internal and external needs of the customers. Thirdly, all employees are empowered to take action in correcting problems (Burnett and Pesch 3). Fourthly, the employees possess cross-functional skill sets that permit them to get assigned to sections that require assistance and to assist to adopt a bigger picture of the entire production process. Fifthly, the JIT employees are linked with the demand-pull discipline in which work is not created unless it is required by the downstream center. Demand –pull enhances the inter-connectedness of the employees. Lastly, the employees have the mandate of basic maintenance of the machines they use. This assists them in having a better understanding of the equipment condition and its capability to meet production and quality requirements (Burnett and Pesch 4). Application of JIT in Operation Management The tools required for achieving lean are generally the same tools promoted in JIT (Naslund 275). Lean is the systematic elimination of waste by all the organization members in all the sections of the value system (Naslund 273). Some of the important tools include Kaizen, Kanbari, Five S, and process/value stream mapping. Both methods attempt to reduce waste and to make the production process flow as value-adding (VA) as possible. In other words, these tools minimize waste and improve the production process. VA practices are activities within the production process that put more vale to the product based on the consumer’s perspective. Kaizen is a theory of constant improvements. Using the Kaizen theory, companies attempt to constantly improve their performance and to maintain a culture of constant improvements. Integrating the concepts of workplace improvement and standardized procedure through the 5S’s can enhance responsiveness and efficiency, and therefore, minimize the costs for the company. The 5S’s include seiri (Sort), seiton (Set), seiso (Shine), seiketsu (Standardize), and shitsuke (Sustain). The 5S’s technique is beneficial for both the company and the employee. Company benefits include improved safety, enhanced availability of equipment and plant, reduced costs, higher quality, and services that are more reliable (Naslund 275). The paper will discuss some of the companies that have applied the JIT philosophy. Daioku Company Daioku Company is a company located in Taiwan and the company deals with different types of automobile lamps. The company has been under pressure to enhance its overall competitive position by enhancing productivity and quality. The executive manager of Daioku Company began promoting the JIT system in 1990 with hopes that it could reduce the inventory level and improve productivity. The system will assist Daioku Company to become competitive in providing lamps of high quality at competitive prices (Gunasekaran and Lyu 408). The company established a committee consisting of each department manager. The committee was to plan and implement JIT system. The JIT system was based on the 5S’s: (a) seiri – this involved classification of the shop floor materials based on their usefulness, (b) secton – it entailed placing the value-added materials in useful positions (Gunasekaran and Lyu 408), (c) seize – this involved removing materials of non-value-added nature, (d) seiketsu – this involved maintenance of the factory, (e) shitsuke – this entailed letting the employees practice good habits and work according to the rules (Gunasekaran and Lyu 409). The work environment of Daioku Company was cleaned up to enhance productivity, quality, and safety. When the system was being implemented, the company constantly improved the quality of training and education and the activities on the basis of the 5S activities (Gunasekaran and Lyu 409). The JIT system was successful and it enabled the company to enhance its productivity and quality. Goodrich Corporation Goodrich Corporation is the leading international supplier of tail to nose services and products to the aerospace industry. The company makes landing gears, evacuation systems, flight controls, and engine satellite systems. The main customers include military, business, space, commercial, regional, and general aviation aircraft suppliers, operators, and manufacturers. Towards the mid-1990s, the company was faced with consumer pressure to enhance performance at one of its facilities at Rohr Riverside in California. The problem became a major concern for the company such that the management assessed options that involved moving work and closure of the plant. Engine and airframe consumers were putting a lot of pressure on the plant to enhance its production activities. In 1996, Goodrich Aerostructures started applying lean procedures to the Riverside plant administrative processes (Office of Strategic Environmental Management 60). As part of its efforts to implement lean, Goodrich Aerostructures utilized various tools, which the company borrowed from the Toyota Production System. The managers at the Goodrich Aerostructures suggested that the policy deployment offers linkage, alignment, and focus. Lean tools offer the means to recognize and eradicate waste. Rapid improvement procedures serve as the main tool for motivating a waste elimination-focused culture shift. For instance, the facilities at the Goodrich Aerostructures perform “more than 350 kaizen rapid improvement events each year to identify and eliminate waste from particular business and production processes” (Office of Strategic Environmental Management 61). Several sites at the Goodrich Aerostructures have significantly changed their manufacturing facilities layout. The change to the cellular layout entails considerable movement of the equipment. This lean approach involves the rearrangement of the production activities into cells, which connect the process stages in the order required to create a constant, one-piece flow to manufacture the product (Office of Strategic Environmental Management 61). The conversion to cellular manufacturing layout resulted in the consolidation of the Chula Vista facility manufacturing operations into two buildings from five. The implementation of the lean methods also doubled the output (Office of Strategic Environmental Management 62). Hewlett-Packard Recently, Hewlett-Packard adopted JIT applications to improve its products and services. A key result of the study was development of the Kanban manufacturing system by Hewlett-Packard. The system was to be used in the manufacture of disk drives (personal mass storage units). The setup for the production process was in U-shape; the process passes a unit at a time and there are no buffer stocks (Barhem, Hsu, and Younies 30). The Kanban manufacturing system is based on the notion that if the “employee’s Kanban out-square is filled, he or she may either complete the unit being worked on, sit idle, or help a downstream employee; once the unit an employee is working on is completed, the employee cannot work on another unit” (Barhem, Hsu, and Younies 31). If a problem happened during the production process, the issue was immediately rectified before the continuation of the production process. Therefore, Hewlett-Packard eliminated the inventories of parts that were defective. Under the system, the employees were motivated to improve productivity and conduct quality work. JIT purchasing was also included in the Kanban system implementation. Hewlett-Packard managed to minimize the whole inventory supply from a period of 2.8 months to a period of 1.3 months for a span of 6 months, and there were only 24 vendors supplying 100 parts just in time. The company managed to reduce the number of vendors by 48 percent, reduce the amount of raw material inspection by 30 percent, and within 8 months, the entire factory output tripled (Barhem, Hsu, and Younies 31). Works Cited Barhem, B., Hsu, C. ED., & Younies, H. “A Review of the Adoption of Just-In-Time Method and Its Effect on Efficiency.” PAMIJ (2007): 25-46. Print. Burnett, John & Pesch Michael J. Operations management: Special topic: just-in-time and lean systems. Connexions, 6 Oct. 2010. Web. 15 Feb. 2012. Fullerton, R. R. & McWatters, C. S. “The Production Performance Benefits From JIT Implementation.” Journal of Operations Management 19 (2001): 81-96. Print. Gunasekaran, A. & Lyu, J. “Implementation of Just-In-Time in a Small Company: A Case Study.” Production Planning & Control 8.4 (1997): 406-412. Print. Naslund, Dag. “Lean, Six Sigma, and Lean Sigma: Fads or Real Process Improvement Methods?” Business Process Management Journal 14.3 (2008): 269-287. Print. Office of Strategic Environmental Management. Lean Manufacturing and the Environment: Research on Advanced Manufacturing Systems and the Environment and Recommendations for Leveraging Better Environmental Performance. Washington: GPO, 2004. Print. Read More